wes gatchalian

New Vape Law to boost gov’t revenues; protect businesses

July 26, 2022 Ryan Ponce Pacpaco 1686 views

THE new vaping law will provide much-need economic boost for small businesses and the government, said Valenzuela City Mayor Wes Gatchalian, one of the principal authors of the bill in the 18th Congress.

The Vaporized Nicotine Products (VNP) bill, a legislative measure that will comprehensively regulate the importation, manufacturing, communication, promotion, sales, distribution and use of vaping products like e-cigarettes and heated tobacco products (HTPs), lapsed into law on Sunday, July 24, 2022.

Gatchalian, who served as Deputy Speaker of the 18th Congress and co-sponsor of the measure in the House of Representatives, said the bill enacts crucial regulations that will prioritize legitimate businesses, safeguard consumers and potentially generate billions in revenue for the government.

“The vape law likewise comes at a crucial time when industries and businesses are now beginning to bounce back from the impact of lockdowns,” Gatchalian said. “Reasonable regulations of these products strengthens the government’s twin goals of boosting revenue and fortifying public health policy.”

The higher taxes on VNPs is expected to largely contribute to fill the funding gap for the Universal Health Care (UHC) program of the government. Republic Act 11467 which was signed in the year 2020, which increases excise taxes on alcohol and VNP products is seen to generate at least P27.9 billion annually, Gatchalian said.

The increased excise tax on VNP products will likewise enable the DOH to push through with its plans to upgrade state medical facilities and establish more hospitals in remote areas, hire and train more doctors and nurses, and scale up non-communicable disease prevention services, especially for low-income families – facilities that the country requires to aggressively combat this continuing pandemic,” he said.

Gatchalian said the measure will prevent the proliferation of the backyard industry depriving the government of much-needed taxes aside from giving jobs to thousands of Filipinos. The vaporized nicotine and heated tobacco products industry is said to have created 879 new enterprises and employs at least 3,000 employees.

“Small and Medium Enterprises (SMEs), key players in our nation’s economy, stand to benefit from vape bill as well as it mandates that vape and heated tobacco products should be Department of Trade and Industry (DTI)-registered and Bureau of Internal Revenue (BIR)-compliant,” he said.

He added that eagle-eyed monitoring and regulation by key government agencies would significantly weaken and even totally cripple illicit trade and the actors behind it. It would also support the work conducted by national customs and law enforcement agencies in facilitating legal trade while concurrently deterring illicit trade and smuggling.

“When we protect the legitimate sellers, we also protect the buyers from unscrupulous players who try to dupe them with dangerous counterfeits,” he said.

Gatchalian reiterated that when Congress deliberated the Vape Bill, they ensured the protection of minors while adult smokers are provided access to less harmful alternatives.

He cited the provision prohibiting the sale, promotion, advertising and product demonstration to minors and that it cannot be sold within 100 meters in places frequented by minors such as schools or playgrounds.

“This law ensures that all these novel tobacco products will follow product standards to protect the public at large,” he said.

Gatchalian said it took two years for the 18th Congress to approve the Vape Law.